Energy policy

Contracts worth £315 million have been awarded
to 27 renewable energy projects with a combined capacity of 2.1
gigawatts, the UK's Department of Energy and Climate Change (DECC)
announced on Thursday.

The "strike prices" awarded to the schemes in
the first-ever Contracts for Difference (CfD) auction were well
below those expected. The strike price is the price paid for each
unit of electricity supplied by the schemes, guaranteed for 15
years.

Carbon Brief's number crunching shows the
government could have supported double the capacity if only the
cheapest renewables such as onshore wind had been supported. It
also shows that offshore wind projects awarded contracts last year
could have been £2.2 billion cheaper, if they had been given the
same support as offshore schemes contracted this year.

Most of the projects are
windfarms

The majority of the 27 schemes are windfarms, including 15
onshore and two offshore schemes (the blue and green chunks below).
The remaining contracts went to five solar farms (yellow) and five
schemes that will burn or gasify waste to generate energy (black
and grey).

The total cost of the schemes is expected to be £315
million between now and the 2020-21 financial year. The schemes
will cost around £4 billion over the full 15-year lifetime of the
contracts, according to DECC figuresquoted by the Financial
Times.

Europe's energy system needs to be fundamentally
transformed, shifting away from reliance on fossil fuels, according
to the European Commission's proposals for an energy
union.

Aframework strategy for the energy union,
published today, explains how the commission plans to achieve this
transformation. The strategy attempts to create a coherent vision
by synthesising all existing EU policies on climate and energy with
a number of new initiatives.

Reactions so far suggest this synthesis has only been partially
successful.
Legal NGO ClientEarth says the strategy lacks clear rules on
how EU targets will be met.
Thinktank E3G says the strategy is "good on vision, but deeply
confused on delivery priorities".
NGO Greenpeace says the plan is "contradictory" and lacks
coherence, while
WWF says it has "blind spots".

Carbon Brief explains where the idea of an
energy union came from and shows how the strategy text has evolved
through several drafts, revealing evidence of the differing
political priorities that have challenged creation of a clear and
coherent strategy.

It's important to note that the commission
proposal will be discussed by member state governments at meetings
in March, April and June. They could propose further
changes.

Moving on from Tusk's energy security
union

The idea of an energy union was first proposed
by European Council president and former Polish prime
ministerDonald Tuskin an April 2014article for the Financial Times. Tusk's
proposal emphasised energy security above all.

It called for region-wide purchasing of gas,
linking and strengthening the EU's electricity transmission
systems, and making "full use" of EU fossil fuel reserves,
including coal and shale gas.

Earlier this month, Carbon Brief produced a
detailedenergy
union briefingbased on a leaked draft strategy
dated 30 January. The briefing explained how Tusk's proposal had
been transformed into a more holistic strategy with five
"dimensions": integrated energy markets, a new deal for energy
consumers, energy efficiency, decarbonising the economy and
research.

Since then, asecond draftwas widely leaked, including to
Carbon Brief. This draft shifted emphasis in a number of key areas
while the final version moves things on again. So, how has the
energy union evolved in recent weeks?

Oil firm BP says the world is still failing to
do enough to tackle climate change, despite major policy
announcements over the past year from the US, EU and
China.

The latest annualEnergy Outlookshows how BP sees the world
changing in terms of economic growth, energy use and emissions.
While BP expects countries to meet current climate pledges, it does
not think they will be enough to avoid dangerous climate
change.

Carbon Brief takes a look at how the media
reported the Energy Outlook and how BP's vision differs from a
climate-friendly future.

Rising energy use and emissions

The BP outlook predicts energy demand will grow
by 37 per cent between 2013 and 2035, reportsthe Guardian. This is "at odds with the
fight against climate change", the paper says.

A more climate-friendly future is set out in the
International Energy Agency (IEA) two degrees scenario. This shows
howenergy efficiencymust play a large part in
limiting emissions.

Global energy demand increases by just 14 per
cent between 2012 and 2035 in the IEA two degrees scenario, slower
than over the past two decades (blue line, below). In contrast, BP
expects the recent rapid growth in energy demand to continue (green
line).